UK Economy

Debate between George Osborne and Jim Cunningham

Wednesday 29th June 2016 Commons Chamber

[Mr Osborne]

I agree with my hon. Friend that a free-floating currency is a shock-absorber that we have the benefit of. We do not have a fixed exchange rate, and of course we are not part of a single currency, so the currency can take some of the strain, and that is reflected in the currency market.

The only thing I would caution my hon. Friend on is this: in 2008 we saw a sharp fall in sterling, and that was sustained, but it did not lead to the boost in exports that people expected at that point. That was partly because other markets, including European markets, were depressed, but, as we came to discover, it was also the case that integrated supply chains these days are more international. For example, car exporters might benefit from the fall in the currency in terms of the price they sell their cars for, but they will have imported parts and will have seen import prices go up. Unfortunately retailers are also warning us that prices in supermarkets, for example, may well now rise because of the fall in the currency, but we will wait and see.

Of course the other challenge we face is from the credit rating agencies—not that everything they say is gospel. Unfortunately, we lost our triple-A rating with Standard & Poor’s and were downgraded two notches a few days ago.

[Mr Jim Cunningham]

Are we still using quantitative easing, and if not, when did that end?

[Mr Osborne]

The shadow Chancellor raised questions about monetary policy. Obviously the Bank of England is independent. The MPC set out the challenging trade- off it might face between a fall in output and a rise in inflation. We will have to wait and see how MPC responds to the judgment it has to make.

The central bank has not been undertaking quantitative easing, but the arrangements put in place by my predecessor Alistair Darling—essentially, the authorisation arrangements —remain in place. In other words, the MPC will be able to use any of the monetary policy instruments in its toolkit, but that is entirely a judgment for it. We will wait to see how it responds to the challenges it faces.

Oral Answers to Questions

Debate between George Osborne and Jim Cunningham

Tuesday 16th June 2015 Commons Chamber

[Mr Osborne]

I congratulate my hon. Friend on his re-election; I enjoyed visiting him in Bedford just before the election. He raises an interesting point about how efficient housing associations are in increasing the housing supply, which is what we want them to do, and we are certainly looking at that at the moment.

[Mr Jim Cunningham (Coventry South) (Lab)]

T10. Given that the Chancellor wants to create the west midlands powerhouse, what is he doing to protect the powers and identity of local authorities such as Coventry?

[Mr Osborne]

I met local authority leaders from Coventry, Birmingham and the surrounding local authorities only a couple of weeks ago, and I made it clear that it is up to them to come together in a combination that suits them and reflects local identities, and that my door is open for any discussions they want to have.

Oral Answers to Questions

Debate between George Osborne and Jim Cunningham

Tuesday 27th January 2015 Commons Chamber

[Mr Osborne]

My hon. and learned Friend is absolutely right. In Lincolnshire and across the country, people have seen unemployment fall and businesses grow. We have got to stick with the long-term economic plan, particularly at a time when the global economic risks are increasing. By working through that plan, we can deliver that economic security for his constituents and mine, and make sure this country has a brighter economic future.

[Mr Jim Cunningham (Coventry South) (Lab)]

T4. Is the Chancellor aware that of the 150,000 people employed in Coventry, 50,000 of them—mainly women and young people—are in part-time, low-paid jobs? What are the Government going to do about it?

[Mr Osborne]

Of course we want to get unemployment down further, and for those who want full-time work, we want to make sure it is available. However, I would point out that, in the hon. Gentleman’s constituency, youth unemployment is down by 73% over this Parliament and unemployment is down by more than a half, so we have got to go on with our long-term plan, which is delivering those jobs in Coventry. Eighty per cent. of the jobs created in the UK at the moment are full time, so we need to sustain that plan, not go back to the chaos we saw under the Government he supported.

Oral Answers to Questions

Debate between George Osborne and Jim Cunningham

Tuesday 2nd September 2014 Commons Chamber

[Mr Osborne]

The autumn statement will be an opportunity to set out further improvements to infrastructure in the south-west, and the services, roads and railways that support Plymouth. My hon. Friend has been a doughty champion for that city and delivered huge investment to it, which was never forthcoming before. I assure him that we are looking at specific transport improvements to connect better the whole of the south-west with the rest of the United Kingdom.

[Mr Jim Cunningham (Coventry South) (Lab)]

Many local authorities are struggling to implement the Government’s policy on free school meals—for example, Coventry has to find something like an additional £1 million. What are the Government going to do about that?

Economic Growth

Debate between George Osborne and Jim Cunningham

Wednesday 15th May 2013 Commons Chamber

[Mr Osborne]

My hon. Friend is absolutely right. Last year, employment in the UK grew faster than in the US, France, Germany, Japan and the eurozone as a whole. Employment in the UK is now above its pre-recession level. Of course we must go on taking the difficult measures necessary to get our deficit under control, and make sure we support businesses that want to hire people to support the private sector recovery. The path being offered by the Opposition, however, would lead to complete disaster.

[Mr Jim Cunningham (Coventry South) (Lab)]

When the Chancellor’s party was in opposition, the right hon. and learned Member for Rushcliffe (Mr Clarke) took the credit, before the banks collapsed, for the economic prosperity, claiming he had created it when he was Chancellor. How does the current Chancellor answer that point?

[Mr Osborne]

The hon. Gentleman is saying that somehow we have a responsibility for the financial crash or for the problems in the banking industry, but he neatly skips the fact that not only was Labour in office for 13 years, but the shadow Chancellor was the City Minister. He did not have any old job in Government —he was the City Minister when Northern Rock was selling those 120% mortgages and the Royal Bank of Scotland was thinking of taking over ABN AMRO. He is the architect of the tripartite regulation, which failed so catastrophically. He is, literally, the last person to have any credibility on this subject.

Oral Answers to Questions

Debate between George Osborne and Jim Cunningham

Tuesday 26th June 2012 Commons Chamber

[Mr Osborne]

My hon. Friend is right and I commend him and his group for the interesting ideas, many of which I agree with, that they are promoting. He is absolutely right to point out the increase in employment, including in manufacturing employment. An interesting recent statistic from an independent international body on the British economy showed that the share of manufacturing in the UK economy is increasing for the first time in a very long time, having almost halved under the previous Labour Government.

[Mr Jim Cunningham (Coventry South) (Lab)]

Why did not the Chancellor cut fuel duty sooner? Why has it taken him all this time? He has done about 33 U-turns as far as I can see.

[Mr Osborne]

Last year we cut fuel duty and froze it. This year, we have frozen it again and the hon. Gentleman should welcome that. I know that he is in a slightly difficult position in that he was one of the Labour MPs who voted for the increase that we have now delayed, but he should just get up and welcome these moves.

IMF

Debate between George Osborne and Jim Cunningham

Monday 23rd April 2012 Commons Chamber

[Mr Osborne]

The European Central Bank is of course a very important part of the equation, but one of the problems facing Ireland, Portugal and, indeed, Greece was that they were also shut out of international debt markets, and when countries are shut out of international debt markets they usually—almost always—turn to the IMF for assistance, so it would be very odd if the IMF were not there to help them.

[Mr Jim Cunningham (Coventry South) (Lab)]

I am glad that the Chancellor has realised—it has taken him four years to do so—that there was a world economic crisis which started outside this country. Yes, Labour in government in the past has supported the IMF, and we still do, as we know that we have to do something to help Europe, but, following what my hon. Friend the Member for Bolsover (Mr Skinner) said, I must ask why are the British people paying for it through one of the most punitive Budgets ever levied? On the one hand they understand that we have to help Europe, but on the other we have one of the most punitive Budgets that has ever been levied on the British people.

[Mr Osborne]

I have never denied that there was an international economic crisis; what I said was that those problems were not visited upon Britain from abroad. Britain was at the epicentre of the crisis, with the biggest bank bail-outs, the most indebted households, the most over-leveraged banks and one of the largest deficits going into the crisis. That is what I complain about, and I complain in particular about the man who was responsible for most of those economic policies giving us lectures on them afterwards. I welcome the fact that the hon. Member for Coventry South (Mr Cunningham) supports the IMF and an increase in its resources, but the money does not come out of the public spending cuts that we have had to make in order to deal with that mess; it comes out of our foreign exchange reserves. We are exchanging one asset for another, and as I have said, every country that has lent money to the IMF has got its money back.